Scotlynn USA Division, Inc. v. Z Top Logistics, Inc. et al

Filing 29

ORDER granting in part 25 Plaintiff's Motion for Default Judgment (Doc. 25) as to Counts I and III against Z Top Logistics, Inc. in the amount of $39,354.62, and is otherwise DENIED. Plaintiff's request for costs is GRANTED in p art and DENIED in part. Plaintiff shall be awarded $400.00 in filing fees and $97.50 in costs of service of process, totaling $497.50. The Clerk shall enter judgment accordingly in favor of Plaintiff and against Defendant Z Top Logist ics, Inc. as to Count I for the actual loss amount, and dismissing Count II without prejudice. The Clerk is further DIRECTED to terminate all pending deadlines, issue the attached proposed Bill of Costs, and close the file. Signed by Judge Sheri Polster Chappell on 6/13/2017. (Attachments: # 1 Proposed Bill of Costs) (LMF)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
SCOTLYNN USA DIVISION, INC.,
Plaintiff,
v.

Case No: 2:16-cv-606-FtM-99CM

Z TOP LOGISTICS, INC.,
Defendant.
/
OPINION AND ORDER1
This matter comes before the Court on Plaintiff Scotlynn USA Division, Inc.’s
(Scotlynn) Motion for Default Judgment (Doc. 25) filed on May 22, 2017. Defendant Z
Top Logistics, Inc. (Z Top) has not filed a response and the time to do so has expired.
For the reasons set forth below, the motion is granted in part.2
BACKGROUND
Scotlynn is a freight brokerage company that contracts with motor carriers to
transport goods throughout the United States. (Doc. 1 at ¶ 5). Z Top is one such entity
with whom Scotlynn contracts. Id. at ¶ 6. On November 12, 2014, Scotlynn and Z Top
entered into a Property Broker/Carrier Agreement (the “Agreement”), the terms of which

1

Disclaimer: Documents filed in CM/ECF may contain hyperlinks to other documents or websites.
These hyperlinks are provided only for users’ convenience. Users are cautioned that hyperlinked
documents in CM/ECF are subject to PACER fees. By allowing hyperlinks to other websites, this
Court does not endorse, recommend, approve, or guarantee any third parties or the services or
products they provide on their websites. Likewise, the Court has no agreements with any of these
third parties or their websites. The Court accepts no responsibility for the availability or
functionality of any hyperlink. Thus, the fact that a hyperlink ceases to work or directs the user to
some other site does not affect the opinion of the Court.
2

The Court finds that an evidentiary hearing is not required and will render a decision based on
the documents submitted.

were intended to govern the transport of various loads of cargo for Scotlynn by Z Top. Id.
at ¶ 7.
Scotlynn then arranged for Z Top to transport 41,580 pounds of frozen chicken
(the “Cargo”) from Missouri to Virginia. Id. at ¶ 9. On October 14, 2015, Z Top picked up
the Cargo, and acknowledged its good condition. Id. at ¶ 10. During transit, Z Top was
in a rollover accident and the poultry was exposed to outside temperatures for over 14
hours, and rendered unfit for human consumption. Id. at ¶ 12. Because of the Cargo’s
temperature, it was rejected. Id. As a result, Scotlynn’s customer pursued a claim against
it for the entirety of the loss, which is $39,354.62. Id. at ¶ 13. On December 11, 2015,
Scotlynn formally notified Z Top of the claim, which Z Top refused to pay. Id. at ¶ 14.
Scotlynn then filed this suit.3 (Doc. 1). Despite service, Z Top has made an
appearance in this case; therefore, a Clerk’s Default (Doc. 17) was entered on April 11,
2017. (Doc. 22). Scotlynn now seeks a default judgment against Defendants and an
award of costs and attorney’s fees. (Doc. 25).
LEGAL STANDARD
Rule 55 of the Federal Rules of Civil Procedure establishes a two-step procedure
for obtaining default judgment. See Fed. R. Civ. P. 55. First, when a defendant fails to
plead or otherwise defend a lawsuit, the clerk of the court must enter a clerk’s default
against the defendant. Cohan v. Rist Properties, LLC, No. 2:14-cv-439-FTM, 2015 WL
224640, at *1-2 (M.D. Fla. Jan. 15, 2015) (citing Fed. R. Civ. P. 55(a)). Second, after
receiving the clerk’s default, the court can enter a default judgment provided the

3

The suit originally named Lyubov Marynova, the sole officer and shareholder of Z Top, as a
Defendant. Because Plaintiff was unable to serve Marynova, she was dismissed without
prejudice. (Doc. 23).

2

defendant is not an infant or incompetent. Id. (citing Fed. R. Civ. P. 55(b)(2)); see also
Solaroll Shade & Shutter Corp. v. Bio-Energy Sys. Inc., 803 F.2d 1130, 1134 (11th Cir.
1986) (stating a default judgment may be entered “against a defendant who never
appears or answers a complaint, for in such circumstances the case never has been
placed at issue.”).
An entry of a clerk’s default, however, does not per se warrant an entry of default
judgment.

Rather, a court may enter a default judgment only if “the well-pleaded

allegations in the complaint, which are taken as true due to the default, actually state a
substantive cause of action and that there is a substantive, sufficient basis in the
pleadings for the particular relief sought.” Tyco Fire & Sec., LLC v. Alcocer, 218 F. App’x
860, 863 (11th Cir. 2007); Nishimatsu Constr. Co., Ltd. v. Houston Nat’l Bank, 515 F.2d
1200, 1206 (5th Cir. 1975) (“The defendant, by his default, admits the plaintiff’s wellpleaded allegations of fact, is concluded on those facts by the judgment, and is barred
from contesting on appeal the facts thus established . . . A default judgment is
unassailable on the merits but only so far as it is supported by well-pleaded allegations,
assumed to be true.” (citations omitted)). “The defendant is not held to admit facts that
are not well-pleaded or to admit conclusions of law . . . [A] default is not treated as an
absolute confession of the defendant of his liability and of the plaintiff’s right to recover.”
Nishimatsu, 515 F.2d at 1206. In considering a motion for default judgment, courts must
“examine the sufficiency of plaintiff’s allegations to determine whether the plaintiff is
entitled to” relief. PNC Bank, N.A. v. Starlight Props. & Holdings, LLC, No. 6:13-cv-408,
2014 WL 2574040, at *1 (M.D. Fla. June 9, 2014) (citation omitted). With these principles
in mind, the Court will address Scotlynn’s Motion for Default Judgment.

3

DISCUSSION
In its Complaint, Scotlynn alleges that Z Top’s delivery of the Cargo in a damaged
condition renders it liable both under the Carmack Amendment to the Interstate
Commerce Act, 49 U.S.C. § 14706 et seq., and for breach of contract. Scotlynn also
brings a claim to enforce a lost instrument.
For the reasons stated below, the Court finds that Z Top is liable under the
Carmack Amendment and thus awards Scotlynn damages commensurate with the loss
as pled. That said, because attorney’s fees cannot be recovered under the Carmack
Amendment, the Court denies Scotlynn’s request for same. See Fine Foliage of Fla., Inc.
v. Bowman Transp., Inc., 698 F. Supp. 1566, 1576 (M.D. Fla. 1988).
Concerning Scotlynn’s breach of contract claim against Z Top, the Court finds that
both are state law claims and thus preempted by the Carmack Amendment. As such, the
Court does not find that Scotlynn is entitled to an alternative award of damages or
attorney’s fees under that claim. Finally, the Court taxes the cost of filing and service of
process fees against Z Top.
A. Count I – Carmack Amendment
Through its Complaint, Scotlynn alleges that Z Top violated the Carmack
Amendment by delivering the Cargo in a damaged condition.

(Doc. 1 at

¶¶ 18). “The Carmack Amendment creates a uniform rule for carrier liability when goods
are shipped in interstate commerce.” Smith v. UPS, 296 F.3d 1244, 1246 (11th Cir. 2002).
“To establish a prima facie case of liability, plaintiff must show that the goods were
delivered to defendant in good condition, that the goods arrived in damaged condition,
and that this resulted in a specific amount of damage.” Scotlynn USA Division, Inc. v.

4

Singh, No. 2:15-cv-381-FtM-29MRM, 2016 WL 4734396, at *2 (M.D. Fla. Sept. 9, 2016)
(citing Offshore Aviation v. Transcon Lines, Inc., 831 F.2d 1013, 1014 (11th Cir. 1987)).
“When a shipper shows delivery of goods to a carrier in good condition and
nondelivery or delivery in a damaged condition, there arises a prima facie presumption of
liability.” Id. (citing UPS Supply Chain Sols., Inc. v. Megatrux Transp., Inc., 750 F.3d
1282, 1285-86 (11th Cir. 2014)). Liability is imposed “for the actual loss or injury to the
property[.]” 49 U.S.C. § 14706(a)(1).
Scotlynn’s Complaint states that the Cargo was in good condition prior to shipment.
(Doc. 1 at ¶¶ 11). The Complaint then states that the Cargo was delivered to the receiver
at an unsafe temperature, and because it was damaged, it was ultimately rejected. (Id.
at ¶¶ 12). Importantly, the Agreement does not limit liability and, instead, defines “full
actual loss” as “the value of the cargo determined by” Scotlynn.4 (Doc. 1-1 at ¶ 11). Thus,
in the absence of any controverting evidence, Scotlynn is entitled to a default judgment
against Z Top for the actual loss of the destroyed Cargo in the amount of $39,354.62.
Turning to Scotlynn’s request for attorney’s fees pursuant to the Carmack
Amendment, Federal Rule of Civil Procedure 54(d)(2)(A) states that “[a] claim for
attorney’s fees . . . must be made by motion unless the substantive law requires those

4

Although Plaintiff has not filed an executed copy of the Agreement with the Court, alleging that
the original instrument is lost under Count III, the Court accepts the allegations that the parties
entered into the Agreement as admitted for purposes of default judgment and the Court will
otherwise enforce the lost instrument pursuant to Fla. Stat. § 673.3091. Based on Defendant’s
default and the absence of anything to the contrary, the Court will assume liability has not been
limited, and that the shipper has not agreed to limit the carrier's liability to a declared value less
than the actual loss or injury. See 49 U.S.C. § 14706(a)(1) (Generally, liability is for the actual
loss or injury to the property caused); 49 U.S.C. § 14706(c) (1) (A) (a carrier may limit its liability
to a value established by the shipper or by written agreement). See also UPS Supply, 750 F.3d
at 1286.

5

fees to be proved at trial as an element of damages.”

The Court, however, finds

Scotlynn’s request to be unwarranted, as “[t]here is no provision for attorneys’ fees under
the Carmack Amendment.” Fine Foliage of Fla., 698 F. Supp. at 1576. Instead, “[t]he
well-established rule is that ‘each party in a lawsuit ordinarily shall bear its own attorney’s
fees unless there is express statutory authorization to the contrary.’” Id. (citing Hensley
v. Eckerhart, 461 U.S. 424, 429 (1983); Reeves v. Harrell, 791 F.2d 1481, 1483 (11th Cir.
1986)). Accordingly, Scotlynn’s request for attorney’s fees stemming from its Carmack
Amendment claim is denied. See Fine Foliage of Fla., Inc., 698 F. Supp. at 1576.
B. Count II – Breach of Contract
As to its breach of contract claim, Scotlynn alleges that Z Top breached the
Agreement and Bill of Lading by delivering the Cargo in damaged condition, and that it,
therefore, suffered damages. (Doc. 1 at ¶ 21-22). Scotlynn pleads this claim in the
alternative. (Doc. 25 at 7).
Under Florida law, there are three elements to a breach of contract claim: “(1) a
valid contract; (2) a material breach; and (3) damages.” Beck v. Lazard Freres & Co.,
LLC, 175 F.3d 913, 914 (11th Cir. 1999) (citation omitted). That said, “the Carmack
Amendment preempts state law claims arising from failures in the transportation and
delivery of goods.” Smith, 296 F.3d at 1246 (citations omitted). “In other words, separate
and distinct conduct rather than injury must exist for a claim to fall outside the preemptive
scope of the Carmack Amendment.” Id. at 1249.
Here, Scotlynn contracted defendants to ship the Cargo from Missouri to Virginia
and, thus, the shipment would qualify as interstate commerce.

Therefore, unless

Scotlynn has pled separate and distinct conduct that would cause its breach of contract

6

claim to fall outside the scope of the Carmack Amendment, its breach of contract claim
will be preempted. Upon review of the Complaint, Scotlynn has not met this threshold.
Consequently, the Court finds the Carmack Amendment preempts Scotlynn’s breach of
contract claim and that the claim must be dismissed without prejudice.
C. Attorney’s Fees
Plaintiff also seeks attorney’s fees pursuant to paragraph 22 of the Agreement and
based on Z Top’s breach of the Agreement. In support of the request for damages and
attorney's fees, plaintiff filed the Affidavit of Katy Koestner Esquivel in Support (Doc. 251). Scotlynn also requests attorney’s fees based on their breach of contract allegations,
but articulates no legal basis for its claim.

Due to preemption by the Carmack

Amendment, this request must be denied. See Strickland Transp. Co. v. Am. Distrib. Co.,
198 F.2d 546, 547 (5th Cir. 1952) (citation omitted) (holding that attorney’s fees are
beyond the scope of the Carmack Amendment and “cannot be considered for
jurisdictional purposes where there is no legal basis for the recovery of such fees”)); Mo.
Pac. R. Co. v. Ctr. Plains Indus., Inc., 720 F.2d 818, 819 (5th Cir. 1983) (finding Strickland
persuasive and holding that “recovery of attorney’s fees in freight damage suits” is not
permitted)); Accura Sys., Inc. v. Watkins Motor Lines, Inc., 98 F.3d 874, 876 (5th Cir.
1996) (same).5
The Court notes that, although the Eleventh Circuit Court of Appeals in UPS
Supply found Strickland unpersuasive, it is distinguishable from the facts of this case. In
UPS Supply, the court found that attorneys’ fees were permitted in relation to the
enforcement of an indemnity clause in an ongoing contract that was separate from the

5

Decisions by the Fifth Circuit Court of Appeals made prior to October 1, 1981, are binding on
this Court. See Bonner v. City of Prichard, Ala., 661 F.2d 1206, 1207 (11th Cir. 1981).

7

theft of goods that gave rise to that plaintiff’s Carmack Amendment claim. 750 F.3d at
1282. This is not the case here, as Scotlynn attempts to base their request for attorney’s
fees on the very instance that invokes liability under the Carmack Amendment. As a
result, Scotlynn’s breach of contract claim is preempted and their request for attorney’s
fees is denied.
D. Costs
In its Motion for Default Judgment, Scotlynn also seeks costs for $400.00 for the
filing fee and $195.00 in service of process expenses. (Doc. 25 at 12). Generally, a
prevailing party may be awarded costs. See Fed. R. Civ. P. 54(d)(1). Costs available to
be taxed are specifically enumerated in 28 U.S.C. § 1920, and include fees of the United
States Marshal. Pursuant to 28 U.S.C. § 1921, a United States Marshal is authorized to
serve process in any case or proceeding. And, despite that private service of process is
not explicitly provided for in either statute, the Court may authorize taxation of such costs
so long as they do not exceed the statutory fees authorized in 28 U.S.C. § 1921. U.S.
E.E.O.C. v. W&O, Inc., 213 F.3d 600, 624 (11th Cir. 2000). In this district, service of
process by a United States Marshal pursuant to 28 U.S.C. § 1921 amounts to $65.00 per
hour, as well as an allowance for mileage.
Turning to the matter at hand, the Court finds that Scotlynn did not prevail against
both parties, and thus that awarding costs for service of process on Marynova would be
improper. A review of the record does not yield an individual accounting of Scotlynn’s
costs of service of process on each Defendant, and thus the Court finds it reasonable to
halve any requested award from $195.00, to $97.50, thereby reflecting the cost of service
for only Z Top. This figure amounts to approximately 1.5 hours of taxable time by a United

8

States Marshall engaged in the act of serving process. As such, the Court directs that
$497.50 be taxed against Defendant Z Top.
Accordingly, it is now
ORDERED:
(1) Plaintiff’s Motion for Default Judgment (Doc. 25) is GRANTED in part as to
Counts I and III against Z Top Logistics, Inc. in the amount of $39,354.62, and is otherwise
DENIED.
(2) Plaintiff’s request for costs is GRANTED in part and DENIED in part. Plaintiff
shall be awarded $400.00 in filing fees and $97.50 in costs of service of process, totaling
$497.50.
(3) The Clerk shall enter judgment accordingly in favor of Plaintiff and against
Defendant Z Top Logistics, Inc. as to Count I for the actual loss amount, and dismissing
Count II without prejudice.
(4) The Clerk is further DIRECTED to terminate all pending deadlines, issue the
attached proposed Bill of Costs, and close the file.
DONE and ORDERED in Fort Myers, Florida this 12th day of June, 2017.

Copies: All Parties of Record

9